Panama's Supreme Court just canceled CK Hutchison Holdings' port concession contracts, declaring them unconstitutional and seizing back two strategic ports. Make no mistake: this isn't about legal niceties. It's a textbook case of American muscle erasing what used to be Panama's free business environment.
A Hong Kong government spokesperson slammed any foreign power using coercion or pressure to bulldoze Hong Kong companies' legitimate business rights abroad.
But the real story lies in the sequence of events. Watch how quickly things unravel when Washington decides it wants something.
A Three-Decade Partnership Suddenly "Unconstitutional"
CK Hutchison had been running port facilities at both ends of the Panama Canal since the 1990s. The contract got renewed in 2021. Leading up to that renewal, Panama's own Audit Office confirmed in its 2020 report that Panama Ports Company—CK Hutchison's local subsidiary—"substantially complied with the concession contract terms." Panama's Maritime Authority echoed that assessment in 2021, stating the company "fully fulfilled the responsibilities of the concession contract."
Fast forward four years. Trump returns to the White House in January 2025, and everything flips. In his inaugural address, Trump signals what's coming: he declares the Panama Canal vital to US interests and vows to "take it back".
Days after Trump's comments, Panama's Audit Office announces a sweeping investigation into CK Hutchison's port operations. The stated goal: determine whether the company honored its concession contract, fully reported revenues and expenditures, and whether corruption tainted the renewal process.
Rubio's Visit Sets the Dominoes Falling
The Trump administration keeps turning the screws. On February 2, 2025, Secretary of State Marco Rubio flies to Panama, pressuring the country to distance itself from China. President José Raúl Mulino caves immediately: he announces Panama's withdrawal from China's Belt and Road Initiative and pledges to strengthen cooperation with the United States to boost American investment in the region.
Two days after Rubio's visit—just 48 hours—two Panamanian lawyers file suit in local courts. They allege Panama Ports Company "violated 10 constitutional provisions" and demand cancellation of CK Hutchison's operating rights at two local ports. The timing isn't subtle.
In July, after months of "study," Panama's Comptroller General formally files suit, asking the court to declare the 25-year port operating contract CK Hutchison signed in 2021 unconstitutional. The Comptroller goes further, criticizing CK Hutchison for insufficient loyalty to the Panamanian government and harming Panama's interests.
On January 12 of this year, Panama conducts joint military exercises with US forces. The declared goal: defending this Central American nation's strategic canal waterway. The message to anyone watching is crystal clear.
A Judicial Rubber Stamp on Raw Power
Finally, Panama's Supreme Court rules that CK Hutchison's port operating contract is unconstitutional. Anyone claiming this was normal judicial procedure isn't paying attention. The reality is Panama buckled under massive US pressure, ripping up a valid contract and forcibly seizing back the operating rights to Panama's ports.
Hong Kong companies have poured substantial investment into Panama and delivered significant long-term economic contributions, supporting local economic development. Panama Ports Company, CK Hutchison's subsidiary, has invested 1.7 billion balboas (approximately HK$13.2 billion) to date—far exceeding the 1.05 billion balboas required by the original contract and supplementary agreements. During its operations, Panama Ports Company contributed 670 million balboas to Panama, dwarfing the contributions of other port operators.
According to Panama's own Comptroller General's evaluation, Panama Ports Company actually contributed over 5.9 billion balboas to the local economy through port added value, indirect benefits, and direct payments to Panama. Those numbers tell the story Washington doesn't want told.
Billions Invested, Contract Honored—Then Torn Up
Hong Kong enterprises consistently invested and operated according to the contract, making important contributions to Panama's economy. Yet Panama, under US pressure, arbitrarily tears up the contract and unilaterally revokes the port operating rights. The absurdity is breathtaking.
This incident carries several layers of implications worth examining closely.
The Panamanian government has become a complete puppet of the United States, arbitrarily confiscating foreign enterprises' assets. Hong Kong and Chinese Mainland enterprises will hesitate to further invest in the region.
Hong Kong's business leaders facing Washington's muscle have one clear path forward: align firmly with Beijing and push back hard. It's the only way to safeguard what's theirs—dignity and capital alike. And you can bet the nation will keep backing Hong Kong companies as they fight to reclaim their rightful business interests.
When US Hegemony Rewrites the Rules
Look at what US unilateral hegemony actually delivers: Washington slaps tariffs on whoever it wants, threatens military action, and tramples the very international rules it once lectured the world about. Under American pressure, investment climates in targeted regions turn into pure jungle. Legal protections evaporate the moment Washington wants them gone.
Stop pretending business operates in some politics-free zone. The truth is: capital has a passport—always has, always will. For businesspeople to survive in this landscape, backing your nation's position isn't optional. It's the baseline for keeping what you've built.
Lo Wing-hung
Bastille Commentary
** 博客文章文責自負,不代表本公司立場 **
China's strategy is simple: throw one punch to avoid a hundred.
On Wednesday, August 5, China fired back with five consecutive moves to counter a string of recent US measures that Beijing sees as hostile. A spokesperson for China's Ministry of Commerce called the countermeasures "generally restrained." The message was clear: since the China-US presidential meeting in Busan, the US Federal Communications Commission has ignored China's strong opposition and industry appeals. It keeps stretching the concept of national security to roll out restrictions on China.
Meanwhile, the US has added over 40 Chinese entities to the so-called Uyghur Forced Labor Prevention Act entity list. China demands the US immediately revoke these measures. And if Washington insists on new restrictions, "China will further retaliate."
China's moves are a direct answer to a series of petty US actions that fall into two main areas.
First, the FCC. Before the government took action, the People's Daily fired a warning shot. Under the byline "Zhong Sheng," it blasted the FCC for hiding behind banners like "non-discrimination" and "national security" to discriminate against and suppress Chinese companies.
The FCC recently added foreign-made power inverters and advanced robotic equipment to its so-called "Covered List." That means new models can't get certification and are locked out of the US market. The paper called the tactic typical unilateral bullying.
This isn't new. Back in 2021, the FCC put telecom and video surveillance gear from five Chinese companies on the list. Since then, it has steadily widened the net. In April, it proposed revoking the qualifications of testing and certification bodies from countries that haven't signed a "Mutual Recognition Agreement" with the US. That artificially raises the compliance bar for Chinese products.
And now, Reuters reports the FCC is drafting a ban on imports of new Chinese-made optical communication transceivers for data centers.
Second, the Xinjiang sanctions. On July 30, the US Department of Homeland Security added over 40 Chinese entities to the entity list under the Uyghur Forced Labor Prevention Act. The move, effective August 3, swells the list from 144 to 187, the biggest expansion since it was created. The new targets span food, clothing, and cotton. They include snack maker Qia Qia melon seeds, frozen food producer Zhengzhou Synear dumplings, and apparel brand Fujian Septwolves.
When the news hit the Chinese internet, netizens erupted in mockery. The joke going around teasing that "eating melon seeds can easily damage US soldiers' teeth."
China didn't waste a second. It fired back with five countermeasures, and the first one hits where it hurts: drones. Beijing is tightening export controls on drones and related technologies to the US. From now on, every shipment of drones, key components, and controlled technologies will face a strict case-by-case review.
And forget about any 'licensing facilitation' exemptions—those are off the table. Think about it: China is the world's drone superpower. The US wanted to block Chinese drones from coming in. Now China is flipping the script—it's restricting what goes out. The message is blunt: just because you want to buy doesn't mean we'll sell. Especially not advanced drones and components with military uses.
The second measure is a highly targeted strike: China has added six US entities to its Countermeasures List, all of which it says assisted US sanctions on Xinjiang-related companies.
Applied DNA Sciences, Inc. is believed to provide DNA-based traceability and verification services for relevant products.
Stratum Reservoir, LLC is believed to conduct stable-isotope testing and related analysis to determine the origin of Xinjiang-linked materials.
Altana Technologies, Inc., which operates a global supply-chain mapping and management platform, is believed to help the US government trace supply chains involving Xinjiang-linked products.
The Responsible Business Alliance, which promotes responsible business conduct in global supply chains and operates assessment programmes for member companies, is believed to help companies exclude Xinjiang-linked products from their supply chains.
Verité Group, Inc., a nonprofit focused on labour rights and human rights, examines alleged forced labour in global supply chains.
Human Rights in China, a New York-based human-rights organization, advocates sanctions related to Xinjiang.
China’s countermeasures against these six entities are therefore highly targeted.
The third measure targets a US compliance testing company that helped the FCC impose China-related sanctions. That company will now be locked out of the compliance testing business in the Chinese market. The ripple effect: it could drive up compliance costs for US products trying to enter China.
The fourth measure hits at the heart of product certification. China is suspending the entrustment of US agencies to conduct factory follow-up inspections for CCC certification. Remember, CCC certification is a must-have for US products to enter the Chinese market. By pulling the plug on US inspectors, China shifts the review work to its own agencies. That spells more time and more uncertainty for American exporters.
The fifth measure, a national security investigation into imported US printing and copying office equipment. On the surface, this one looks like a light tap.
China imported about $2.08 billion worth of such equipment in 2025, mostly from Japan ($1.72 billion). The US slice was small. But this is just the opening move.
The US has banned Chinese software and hardware from connected and autonomous vehicles on American roads—and until now, China held its fire.
Now Beijing is investigating US printers and copiers on national security grounds. The message is unmistakable: if Washington plays the national security card at every turn, Beijing can just as easily slap an 'unsafe' label on American phones and EVs running US software.
But that's not the main battlefield. Artificial intelligence is the real arena. Over the past month, Chinese companies have rolled out one high-performance, low-cost AI model after another, sending US AI giants reeling. When Anthropic released a new model in June, the US government demanded it be kept out of non-American hands. The clash forced Anthropic to pull the model. Trump signed an executive order in June setting up an AI safety framework, including a voluntary program for companies to submit cutting-edge models for government review.
Then Chinese developers like Moonshot AI and DeepSeek unleashed open-source systems that rival top-tier US models, fueling a fierce debate in Washington over how to regulate open-weight models. Anthropic CEO Dario Amodei pushed for mandatory government safety reviews for both open and proprietary models, taking direct aim at Chinese open-source systems. He won backing from Treasury Secretary Bessent and others, but ran into a wall of opposition from US tech giants, including Nvidia.
On August 4, the Trump administration delivered its verdict. In a meeting led by the Office of the National Cyber Director, top US AI companies were told that under the new AI safety framework, open-source models from Chinese rivals would not face US government safety testing.
For Anthropic, it was a crushing defeat. US National Cyber Director Sean Cairncross later spelled out the thinking at a cybersecurity conference in Las Vegas: the US government wants to back the American open-source AI ecosystem. He called such models 'tremendously valuable' and insisted the regulatory framework must stay 'flexible.'
Otherwise, he warned, 'it would not only stifle growth, development, and innovation, but the regulatory regime would become obsolete within 48 hours of completing its process.'
The bottom line: Washington keeps chipping away at China with petty moves. But when the pile gets high enough, Beijing punches back hard—and signals it has heavier blows ready.
President Xi is due to visit the US in September, and Trump will be in Shenzhen in mid-November for the APEC summit. Trump doesn't want things to spiral out of control; at crunch time, he'll yank the leash on his officials.
The real battlefield is artificial intelligence. It was almost certain that the White House's decision to leave Chinese open-source models alone came after fierce pushback from China.
Lo Wing-hung
